GST on sale of Used Motor vehicles

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This discussion clarifies the Goods and Services Tax (GST) applicability on the sale of used motor vehicles, specifically lorries. It confirms that GST is applicable on the profit margin when a used vehicle is sold for more than its purchase price, provided no prior CENVAT credit was claimed. The applicable GST rate is generally 12% (6% CGST + 6% SGST) for used vehicles, though the initial query considered 18%. A relevant notification (Notification No. 8/2018-CGST Rate) is referenced, which details the 6% CGST rate for old and used vehicles.

sd. aleem

sd. aleem (Querist)

01 October 2020 Sir,
I have purchased a lorry on 01.07.2016 and sold it on 31.07.2019 with a profit of 3 Lakhs. No cenvat credit availed on purchase. Whether GST applicable on it? If yes, what is the GST rate ? On which amount GST is applicable?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

01 October 2020 18% GST applicable on 3 lacs profit.

sd. aleem

sd. aleem (Querist)

03 October 2020 If the HSN Code is 8704, Now at what rate GST is calculated?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

03 October 2020 18% GST applicable...........

sd. aleem

sd. aleem (Querist)

05 October 2020 Thanks for your information sir.

Can you please check this notification, in which it shows 6% - CGST for sale of old and used vehicles.

https://cbic-gst.gov.in/pdf/central-tax-rate/notfctn-08-2018-cgst-rate-english.pdf

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

05 October 2020 Agree with you it's 12% GST (6% cgst plus 6% sgst).

sd. aleem

sd. aleem (Querist)

14 October 2020 Thankyou sir.
What if the vehicles were rented to the party and at what rate GST to be calculated?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

14 October 2020 18% GST applicable......

sd. aleem

sd. aleem (Querist)

20 October 2020 THANKS FOR YOUR IMMEDIATE RESPONSE SIR,
CAN I GET REFERENCE NOTIFICATION TO THE ABOVE MENTIONED QUERY, IF ANY?